self employment

[pilotwood51]

My wife and I are Realtors.  We have an LLC and fill out a Schedule C.  We do the usual deductions- car miles, business expenses, etc.  Are there any unusual deductions we should consider?

[gkacpa]

Hello @pilotwood51 , that is wonderful that you have your own business! 

There are quite a few options when it comes to deductions. Depending on where you run your business out of, you may qualify for the Home Office Deduction. This allows you to deduct a certain percentage that is allocable to your home office. It must be exclusively used for business purposes and must be the main place where you conduct your business. This deduction allows you to deduct a portion of your rent/mortgage interest, utilities, home repairs, home insurance, etc. You can read more about the home office deduction here. 

Additionally, if you pay for licenses and permits to keep your real estate license, those would be deductible as well. You may also benefit from communication type expenses, depending on the percentage you use your phone for business purposes. 

Gift to your clients may be deductible up to $25 per customer, per gift. 

[Natalie A]

Hi Pilotwood51, I'm happy to hear that you are taking advantage of the deductions on your Schedule C. As a real estate professional, the IRS considers you and your wife statutory nonemployees and you are treated as self-employed for all Federal tax purposes. Some expenses that would be deductible and would likely apply to both you and your wife are: Advertising (Brochures/Flyers, Business Cards, Direct Mail, Email Marketing and Newsletters, Internet Ads, Leads/Mailing Lists, Post Cards, Print Ads (Newspapers and Magazines), Promotional Materials, etc.), Auto Expenses, Business Travel, Office Expenses, Employee Wages, Communication ( cell phone, efax, internet, office phone, answering service), Equipment (Cameras, Cellphone, Computer, Lock Boxes/Locksmiths/Keys, Printer), Professional Fees(MLS Fees, dues, business licenses, legal fees), Retirement, and Training. I would recommend using a checklist specific to your Real Estate profession to stay organized and ensure you that you are taking advantage of all possible deductions. Here is an example of a real estate tax deduction checklist

Additionally, TurboTax has an excellent resource that you may find helpful. The article is titled Tax tips for Real Estate Agents and Brokers and is updated regularly. 

IRS Deducting Business Expenses